Tuesday, January 16, 2018

When did you last review your estate plan?How long ago did you put in place your estate
plan?5 years? 10 years?Over 10 years?Do you currently have an estate plan in
place?

Reviewing one's estate plan serves at least two critical
functions.First, a review can guarantee
your plan still functions according to your wishes.All these questions can be answered by comprehensively
reviewing your estate plan:

·Do your assets still go to who you want?

·Are the correct people listed in decision-making
roles?

·Have your desires changed for who you want to
receive your assets?

·Have certain decision-makers moved away?

·Have minor children now become responsible
adults who are ready to serve on your behalf?

Secondly, a review can alert you to new laws affecting your
estate plan?An example from a few years
ago would be the changes regarding access to medical records with the Health
Insurance Portability and Accountability Act (HIPAA).A more recent example is the 2017 Tax Cuts
and Jobs Act, which changed estate and gift taxation rules.Whether it is the State Legislature or Congress,
both organizations continue to pass laws to meet changing circumstances.Staying up-to-date can mean the difference
between a plan accomplishing your goals and a plan that causes unneeded problems
and headaches.

For all our clients, we offer complimentary reviews every 3
years.For clients, it is a chance to
review their estate plan to ensure everything is current and there are no
major changes requiring updates due to the passage of new laws.For us, it is a chance to talk with clients
and ensure their estate plan continues to meet their objectives.

Whether you worked with us in the past or wish to work with
us in the future, give us a call today or send us an e-mail by clicking
here!We are always happy to assist individuals,
businesses, and families, plan for a smooth and seamless future!

Friday, December 22, 2017

Earlier today, President Trump signed into law the Tax Cuts and Jobs Act of 2017, capping one of the most significant tax overhauls in the last 30 years. One of the items sure to generate conversation is the changes made to estate taxes.

Before we review the changes made to the estate tax, let's look back at the previous state of the estate tax. Prior to the passage of the 2017 Act, the last major estate tax change occurred in 2012.
Toward the end of 2012, Congress passed the American Taxpayer Relief Act (ATRA). It was signed into law by then-President Obama on January 2, 2013. ATRA amended the prior laws regarding estate taxes and set the estate tax rate at 40%. However, the 40% tax rate was only applicable to individuals who, at their death, sought to pass assets in excess of $5,000,000. So, while a 40% tax rate was high, a minimal number of individuals were affected.

To go even further, ATRA included an inflation-protection rider, further increasing the exemption level with each passing year. In 2018, the exemption level was set to increase to $5,600,000. This means, under ATRA, an individual who died in 2018 could leave $5,600,000 to any number of individuals, charities, etc. without having to pay a single penny in estate taxes.

For a married couple, the ATRA rules allow a virtual doubling of the estate tax exemption level, provided the proper tax forms are timely filed. In essence, this would have allowed both spouses, cumulatively, to transfer up to $11,200,000, without triggering any estate taxes in 2018.

Now let's review the Tax Cuts and Jobs Act of 2017. With the signing of the 2017 Act, the estate tax exemption is doubled (currently, for years 2018-2025). This means that where before an individual could exempt $5,600,000, an individual can now shelter $11,200,000 from any estate taxes. For a married couple, properly utilizing the exemption rules, the exemption is doubled to $22,400,000. If no further action is taken by Congress prior to 2025, the exemption amounts will revert to the previous ATRA levels.

With such a high exemption level, only about 0.3% of the population needed to worry about estate taxes under ATRA (and now it is even less, with the exemption doubling),. This does not mean though that the other 99.7% of the population does not need to complete their estate plan.

Instead of focusing on estate tax avoidance, we can now examine your personal goals and how to protect your assets and your family. This includes protecting assets from beneficiaries, avoiding the probate process, and ensuring a smooth passing of your assets to your chosen beneficiaries. If you’d like to ensure that you maximize the resources available to your loved ones and keep your family out of Court and out of conflict, schedule a Family Life and Legacy Planning Session.™ We can review your existing plan and help you make adjustments, while achieving your personal goals.

This article is a service of The Estate Planning Group and Davidson Law Office, LLP, your Life & Legacy Planning Lawyers, who believe in developing trusting relationships with families for life. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.

Monday, November 6, 2017

Misconception #1: A Power of Attorney can be used after death. No. Upon a person's passing, Powers of Attorney lose any and all authority possessed during a person's life. Whether a Power of Attorney for Health Care or a Power of Attorney for Finances, both documents, expires upon death. Neither document allows for anything to be done after death. Such decisions remain strictly in the hands of the Personal Representative under a Will or a Trustee under a Trust.

Misconception #2: A Will avoids probate. No. A Will is the primary tool of the probate system. Your Will is like a letter to the Court telling the Court how you want your property distributed. The Court gets to interpret your Will. After your death your representative must prove to the Court that all your property is collected and appraised, and all your bills and taxes are paid, before your property can be distributed to your heirs.

Misconception #3: Your Will and your assets remain private. No. Because probate is a public legal proceeding, everything that occurs with your estate will become public record. This means that anyone – including nosy neighbors and salespeople – can go to Court to find out the balance in your accounts, the value of your stocks and other assets, and who you left your property to.

Misconception #4: Estranged family members do not need to be notified of a probate if the Will excludes them from an inheritance. No. All heirs must be notified of the probate even if they are excluded from the Will. It is safer to handle an estate with potentially disgruntled heirs through a Living Trust.

Misconception #5: A Testamentary Trust avoids probate. No. A Testamentary Trust is a Trust created at your death by direction of your Will for a specific purpose. Your Will and estate still must go through the probate process.

Misconception #6: Minimizing Estate Taxes should be a primary concern. Probably No. Currently, the exemption level is over $5,450,000 per person. This means prior to having to pay any estate taxes, you need to have assets over that exemption level. While there may be other taxes worth worrying about, namely income taxes on pre-tax retirement accounts, estate taxes often are not of paramount importance.

Misconception #7: Revocable Living Trusts are only for large estates. No. Revocable Living Trusts are for anyone who wants to avoid costly conservatorship and probate proceedings. Those with small estates, and especially their heirs, can benefit from a Revocable Living Trust.

Misconception #8: A Revocable Living Trust must have a separate tax return. No. If you are a trustee or co-trustee of your Revocable Living Trust, it does not need a tax return of its own. Your personal tax return is sufficient for the IRS.

Misconception #9: There are no costs associated with administering a Trust at the death of the original settlor of the Trust. Not always true. Depending on what assistance and professional help a Trustee relies on, administering a Trust, distributing the assets, and terminating the Trust can result in fees and costs. Many trustees hire attorneys and accountants, but these costs are substantially less than the costs of probate. Typically, these costs are paid by the Trust.

Misconception #10: You have to amend a Revocable Living Trust when you buy or sell your assets. No. Your Trust does not have to be changed when you buy or sell assets. When you buy a new asset, such as real property, a car, or open a new bank account, you simply take title as trustee of your Trust. If you sell an asset, you sell it as trustee of your Trust.

If you’d like to ensure that you maximize the resources available to your loved ones and keep your family out of Court and out of conflict, schedule a Family Life and Legacy Planning Session.™ We can review your existing plan and help you make adjustments that will help you achieve your goals.

This article is a service of The Estate Planning Group and Davidson Law Office, LLP, your Life & Legacy Planning Lawyers, who believe in developing trusting relationships with families for life. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.

Tuesday, October 10, 2017

Mistake #1: Relying on the Law. If you do not set up an estate plan, upon your death your property will be distributed according to the laws of your last state of residence. Often, the law will require the probate judge to give your property to someone other than the people you would have chosen.

Mistake #2: Relying on a Will. If your estate plan consists only of a Will, your heirs may face many costly problems such as probate and conservatorship proceedings. A Will is the most common estate planning tool, but it is usually not the best tool to use.

Mistake #3: Relying on Community Property laws. Relying on the Community Property laws is a position many clients take. However, your property will still have to go through probate on the death of the spouse. Also, Community Property ownership requires a conservatorship if a spouse is incapacitated and the home needs a mortgage, home equity line, or to be sold. Relying on the Community Property laws is not a good estate plan.

Mistake #4: Relying on Guardianships. These Court supervised proceedings for addressing your physical or mental incapacity are costly, time-consuming and horribly burdensome. Your properly set up Revocable Living Trust, as well as Powers of Attorney, Durable Powers of Attorney for Health Care, and Physician’s Directives and Releases avoid this issue.

Mistake #5: Relying on the small estate affidavit or informal administration procedure to avoid probate. Most people assume they have fewer assets than they actually have. In Wisconsin the small estate exemption that avoids probate is permitted only for estates consisting of less than $50,000.

Mistake #6: Relying on a gifting program as your way of avoiding probate. The law allows you to give away your property at a rate of $14,000 per person per year. A married couple can give $28,000 per year to anyone they choose without gift tax consequences. While this is an effective way to reduce the size of your estate, trying to spend your last dime on your last day is difficult to put odds on, plus you lose control of the assets you have given away, and beneficiaries get total control over everything that has been given to them.

Mistake #7: Relying on the Courts to take care of your child’s finances. If you die intestate (with no Will) or with only a Will, and your property passes to your minor child, the Court will put your child’s money into a Court-supervised guardianship requiring at least annual accountings to the Court. Naturally, this may require hiring CPAs to prepare accountings, and lawyers to file those accountings with the Court, plus filing fees, all of which comes out of the inheritance. It also means that the Court determines the person who will serve as guardian of the property, who may not be the person you would have chosen.

Mistake #8: Relying on a form kit for your Will or Living Trust. One size does not fit all because no two people or families are alike. From your family’s needs and dynamics to its personalities and values, can you imagine any form kit ever being suitable for any family? If you use a form kit, you’re asking for problems. If your will is not properly executed, it will not be valid. The only estate plan you can rely on is one that is custom prepared by a qualified estate planning and asset protection lawyer.

Mistake #9: Relying on the wrong attorney. Most attorneys know very little about estate planning. What’s more, even some estate planning attorneys don’t put much time or energy into comprehensive protections for your family’s unique circumstances. That’s why I urge you to choose an estate planning attorney who has the primary focus, mission and purpose to help you achieve your family’s estate planning and asset protection goals: protecting, preserving and passing on more of what you’ve worked for.

If you’d like to ensure that you maximize the resources available to your loved ones and keep your family out of Court and out of conflict, schedule a Family Life and Legacy Planning Session.™ We can review your existing plan and help you make adjustments that will help you achieve your goals.

This article is a service of The Estate Planning Group and Davidson Law Office, LLP, your Life & Legacy Planning Lawyers, who believe in developing trusting relationships with families for life. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.

Friday, September 22, 2017

Facebook! With users easily surpassing 1,000,000,000, Facebook is arguably the most common social media platform. However, what happens to your Facebook page when you pass away? Who has access to your profile upon your death? Can you have your account deleted upon your passing?

As the desire for greater access to decedents' accounts grow, Facebook has come up with several different options for accessing a decedent's page.

One of the most common means is the legacy contact. Each person can designate one of their Facebook "friends" to serve as their "legacy contact" after they pass away. This individual has the authority to write posts on their wall, post articles (e.g. an obituary), and even shut down their Facebook page. This process can work great if you have a desire to notify distant relatives/friends of your passing when most of your communication is through social media. As social media becomes the norm for notification about such events, the legacy contact option is becoming more and more popular. https://www.usatoday.com/story/tech/2015/02/12/facebook-policy-change-allows-one-final-post-after-death/23184757/

Another option is to have Facebook simply delete your profile upon your passing. This option is great for the individual who simply wishes their online persona to die with them. No exposure of past messages or lingering digital presence. Instead, your Facebook profile is simply deleted after Facebook is notified of your passing.

A final option utilized by some, but certainly not condoned by Facebook, involves sharing your username and password with a trusted person and informing them to login as you after your passing and shut down your profile. While this may be the simplest option, sharing username and passwords is a risky proposition, indeed!

While Facebook is just one electronic provider, there is no denying that online accounts are becoming more pervasive. And while Facebook is just one example, with online banking, automatic billing, etc. all becoming much more commonplace, knowing how your online accounts will be addressed are a top priority to ensure an easy and smooth process for the loved ones you leave behind!

If you’d like to ensure that you maximize the resources available to your loved ones and keep your family out of Court and out of conflict, schedule a Family Life and Legacy Planning Session.™ We can review your existing plan and help you make adjustments that will help you achieve your goals.

This article is a service of The Estate Planning Group and Davidson Law Office, LLP, your Life & Legacy Planning Lawyers, who believe in developing trusting relationships with families for life. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.

Thursday, August 3, 2017

With tax time well behind us, you may be thinking you did well by minimizing what you paid to Uncle Sam and your state in taxes, so more can go to your family. Every year around tax-time, we’re reminded of how complicated maximizing your money and minimizing tax liabilities can be - and for many people, this seems to be the singular focus for how to preserve assets for loved ones.Unfortunately, we don’t get much in the way of real information about really preserving our assets through estate planning. And, regrettably, many of us simply don't think about it, or maybe think we don't have enough to make a difference.

Simply put, this is Penny Wise and Pound Foolish - Your family will likely lose more in the costs of estate administration than you can ever overcome with annual tax tricks.

Truth is, if you have people you love and any assets at all in your name, you do have an estate and it is worth preserving for the people you love. In some cases, that may mean keeping them out of court and out of conflict, if anything happens to you. (Did you know that the biggest family fights happen over the smallest sums of money or even the personal effects of a person who has passed on? Let’s keep that from happening to your family!)

If you’re concerned about maximizing the amount your heirs receive and minimizing the amount received by governments, there are several steps you can take.

First and foremost, keep your family out of Court. It’s unnecessary, extremely expensive and almost always public. Consider using a Trust to make it easy to handle your assets if you become incapacitated or when you pass on.

Second, ensure legal documents are in place for trusted family or loved ones to take care of financial, legal and health care issues in the event of any incapacity. An incapacity without simple legal planning in place can be devastating to a family, both financially and emotionally.

Third, while most Americans need not worry about the Federal estate and gift tax ($5.49 million in 2017), if you have an estate near or above that level ($10.9 million for married couples) you need to implement tax minimization strategies to avoid the extreme estate tax hit your heirs will experience. Some will need to think about State taxes, as well, if you live in one of the 20 states that impose them. (Wisconsin does not.)

If you’d like to ensure that you maximize the resources available to your loved ones and keep your family out of Court and out of conflict, schedule a Family Life and Legacy Planning Session.™ We can review your existing plan and help you make adjustments that will help you achieve your goals. This article is a service of The Estate Planning Group and Davidson Law Office, LLP, your Life & Legacy Planning Lawyers, who believe in developing trusting relationships with families for life. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.

Tuesday, June 20, 2017

We are all busy, right? We
have things to do, places to visit, and people to see. So, it is understandable
why people do not often think about what would happen in an emergency,
where something happens and you can no longer do things you want, visit the places
you plan, and see the people you want.

While a proper estate plan
cannot avoid these issues, it can leave you better equipped to address these
situations when they arise.

Here are 10 estate planning
questions to get you started. How many of these questions can you answer,
"Yes" to?

1.Have
you appointed a trusted financial decision-maker for financial decisions during
your life?

2.Have
you appointed someone who knows your health care wishes if you cannot
communicate them?